Tuesday, January 8, 2013

Wake-up call – Can you deduct wages if staff can't get into work?

Wake-up call – Can you deduct wages if staff can't get into work?

THE PROBLEM

I have an employee who was unable to attend work owing to travel disruption. Do I have to pay him for that shift? What should I do if this happens again and is there anything I can do to minimise anticipated travel disruption?

THE LAW

It is unlawful to make a deduction from a worker's wages unless the deduction is authorised by statute, by a contractual term that has been notified to the worker in writing, or by the worker having given their prior written consent.

The first thing to establish is whether there has been a "deduction" at all, and there will be no deduction unless the employee can establish some legal right to the wages in question.

The key issue is to decide whether there is a contractual right to be paid if the employee cannot attend work.

There is often no obvious express or incorporated term, and no evidence of custom and practice. The basic contractual position in such cases depends on the type of contract.

Hourly-paid employees with no guaranteed hours have no contractual right to wages unless the employee actually turns up and works in accordance with their contract.

Salaried employees are entitled to be paid even if not provided with work, so long as they are "ready and willing" to work. In these circumstances, the position is less clear. Case law supports the view that provided the non-performance of work is involuntary and unavoidable, the employee may be entitled to their wages. In view of the lack of any conclusive case law on this subject, the rights of employees who are unable to work due to travel disruption may depend to a large degree on how the parties have behaved on previous occasions. Where there is nothing from which a contrary intention can be inferred, it would appear that wages should continue to be paid during unavoidable absence.

EXPERT ADVICE

There are a number of business reasons to pay employees even if they are unable to come in to work, not least to enhance employee relations and boost morale by showing empathy to employees and providing a flexible and fair solution.

On the other hand, paying all staff regardless of whether they are able to work may encourage some employees not to make the effort. It is important in those situations to ensure that employees who turn up for work feel that their efforts have been recognised.

Where employees know that failure to attend work will result in loss of pay, employers may experience an increase in sickness absence. To reduce anticipated absences employers could inform employees in advance that all sickness absence during the relevant period will be followed up with a return to work meeting.

Employers should consider preventative measures to minimise disruption. This could include homeworking where appropriate or varying hours of work to avoid particularly congested periods.

The employer may want to offer employees the opportunity to take the absence as paid annual leave, assuming they have sufficient entitlement remaining, or could allow the employee to make up the lost hours on other days.

CHECKLIST

Develop a business continuity plan incorporating a strategy to deal with major travel disruption.

Decide whether employees will be paid if they cannot make it to work, and ensure any guidance is applied consistently.

Implement a policy setting out how you will deal with major travel disruptions.

Publicise the policy internally before any likely period of travel disruption, and ensure that all staff and managers are aware of their responsibilities.

Consider alternatives such as homeworking or varying hours of work.

Consider the employee relations angle and effects on staff morale.

BEWARE

It is important that staff are treated fairly in these circumstances, not only to avoid feelings of resentment where some employees are paid and not others. Treating staff differently could result in claims of, for example, discrimination or less favourable treatment for taking time off to care for a dependant whose care arrangements are disrupted. Such claims can result in uncapped awards at the employment tribunal. Employers should also consider the effects of bad publicity associated with docking employees' wages.